Big profits for the big banks

Tuesday 29 January 2002 00:00 BST

Knockout profits at big banks

THE big UK banks are set for a record £25bn profits, defying the slowdown. That comes to more than £400 for each UK citizen.

The strong performance comes during the worst year for the manufacturing sector in nearly a decade. Banks are bound to come under renewed criticism from consumer groups and MPs who claim that the big lenders are colluding to overcharge customers.

Before taking the chair of the London Stock Exchange, Don Cruickshank accused the banks of earning £5bn excess profits a year. A Competition Commission report on small business lending is imminent.

Northern Rock kicks off the bank reporting season on Wednesday. But Barclays, Lloyds TSB, HSBC, Royal Bank of Scotland and HBOS will attract more attention. Barclays' and Lloyds' results are due in a fortnight.

HSBC chairman Sir John Bond is likely to report the biggest profits of £7bn pre-tax, but sluggishness in Asia means underlying profits may fall to £6bn.